China’s CST Mining embraces digital economy; changes name, lays out plans for e-logistics platform
CST Mining Group, which last year recruited the founder of the smartphone taxi app “Kuaidi Dache” as a major shareholder, says it will focus on expanding its e-logistics platform nationwide in view of the vast and undeveloped market in the country.
“We will focus on the expansion and building up the scale,” said executive director Chen Weixing, adding that making profit is not the company’s priority in the next two years.
Chen, the founder of the smartphone taxi app “Kuaidi Dache”, has been appointed as an executive director of CST in November last year in a move to turn CST ‘s core business from mining to e-logistics. The company on Monday was approved to be renamed NetMind Financial Holdings.
NetMind will build up an internet platform and mobile phone app that will provide matching with truck owners, shippers and goods transportation companies.
“The logistics market in China is huge. The turnover of road freight in the mainland reached 2.1 trillion yuan [HK$2.5 trillion] in 2014 and is expected to reach 4.4 trillion yuan in 2020 with a compound annual growth of 12 per cent,” said Chen.
Chen is a well known figure in the car-hailing business in China as he co-found Hangzhou Kuaizhi Technology, a company established in November 2012 engaging in the development of the smartphone taxi app “Kuaidi Dache”. The app primarily provides mobile-based car booking services, and has become a major competitor to traditional taxi services. In February 2015 the company merged with another leading smartphone taxi app company, Didi Dache. Chen left Kuaidi after the merger.
Last week, the merged company Didi Chuxing, Uber Technologies Inc’s main rival in China, received a US$1 billion investment from Apple Inc. It marks the largest investment received by the loss-making company.
Reuters on Monday reported that Didi Chuxing is working towards an initial public offering in the United States that would likely take place in 2018.
Didi is currently seeking to raise US$3 billion from investors in its latest funding round, which includes Apple’s investment. It had originally planned to raise US$2 billion, but hiked its target after Apple came aboard as an investor, Reuters quoted sources as saying.
Chen said Apple’s investment proved the business model of car-hailing services in China.